Cement industry may enter a "new era of the Warring States" - China Sheet Metal Fabrication

Cement industry, "Spring is no longer" From the current situation of cement industry, or only look at the current domestic prices of cement, said that the cement industry to the juncture of life and death perhaps a bit too much: Since August, the price of cement once "diving" in some provinces in eastern and southeastern regions of the cement prices began to pick up, in mid-August in southern Jiangsu and northern Zhejiang region of clinker cement companies at the same time the price increase of 10 yuan / ton; in late August to early September, Nanjing Conch price increase 20 yuan / ton; in Jiangxi province cement prices 10 yuan / t; In early September, Jilin, southern Jiangsu, Shanghai, Fujian, Hunan, and the Pearl River Delta and other places of cement prices are rising, the rate of increase is generally 15-20 yuan / ton. In the week before National Day, Zhejiang and Jiangxi provinces and the Wuhan City, the second price increase of cement prices in the range of 10 yuan / ton, the PRD has begun the third price increase. The price increases mean that the improvement of the general state of the cement industry? At this time the view proposed by excess capacity, is not it better?

   "The price rise is the company the opportunity to take the holiday buying season make up the losses of the act." Golden State Securities analyst Zhou Xinxin building materials industry, said the price rise can not be simply understood as the cement industry's warmer. He said that the price increases, largely due to the current has entered the construction season, an increase in demand for cement in this opportunity, companies prior to the price to compensate for losses caused by a sharp decline, while the action. A clear signal is that the areas of cement prices are down by a big margin before the price area. "Cement products have a strong regional characteristics, its price naturally 'inherited' this feature." Zhou Xinxin said. However, this does not hide the fact that the cement industry difficult.

    In May of this year, cement prices bottom, the problem of excess cement production capacity began to emerge. Industry to improve access to the threshold is related to the subsequent tightening of credit, the reporter from a commercial bank was informed by relevant parties, although the absence of express provision, but the commercial banks have excess capacity of some industries a "key control", Development and Reform Commission which includes not only been named in six major industry, some banks will also be expanding the scope of regulation to the real estate, the city voted enterprises. Drop in prices and policy tightening, in the cement industry has launched a bloody house. "At present, Jiangsu cement market can be described as bloody years." In August the cement industry investment strategy at a conference, group vice president of Hong-Bin Xu, Jiangsu solid plate say "The main reason is based on conch shells, the South, Jinfeng, disk solid for the the main production of large enterprises increased rapidly, resulting in an imbalance between supply and demand. If the regional companies are not to price coordination or coordination is not successful, such a bloody close-quarter fight will continue. "

    Large enterprises do not worry out of production capacity According to data published by the Chinese Government Network, 2008, there were cement enterprises 4350, the cement capacity of 1.87 billion tons, the National under construction and proposed projects are completed, will add 830 million tons of cement production capacity. If you can not be eliminated within three years backward cement production capacity, total capacity will reach 2.7 billion tons of cement production capacity would be a serious surplus. Thus, the State Development and Reform Commission in 2009 38 of document clearly stipulates that local governments need to specify the three-year period 2010-2012 the complete elimination of backward production capacity of the schedule, in accordance with industry standards firmly eliminate backward production capacity, product mix to achieve a complete cement adjustment. This requires large-scale cement enterprises in China, there is no cause to imagine the "earthquake" effect. "At present Conch Cement [44.58 1.57%] of capacity at the fully released state and eliminate backward production capacity of our little impact." Conch Cement official said. The source said that although China's 300 million tons of cement industry has surplus capacity, but in accordance with industry standards, there are about 400 million tons production capacity will be eliminated. "Even if limited production, will never meet the industry standards will begin to limit the backward production capacity, the conch of production will not be affected." Funded a large-scale cement enterprises have produced a technological edge, face the crossroads of development, they have another one choice: to enter the downstream concrete industry. "As the upstream raw materials industries, the cement can not lead the downstream market, its development to benefit from investment in industry, are subject to investment; from cement investment situation, the situation of oversupply in some regions being formed, therefore, cement enterprises to survive and development, according to their upward extension of the downstream industry chain is an inevitable choice. "Xu, vice president of China Building Material Association, said mold. At present, many multinational cement companies have been extending their reach to the concrete industry, a number of leading cement companies have also been one step ahead: At present, China Resources Cement, Beijing Golden corner and so have the downstream industry has entered a cement concrete industry. If the above two reasons for the large-scale cement enterprises is not "fear" state is working on initiatives to phase out production capacity, then the other reason was to make them even welcomed the initiatives related to soon as possible. It was at the September 30 ministries, the State Council approved the multi-inhibiting excess capacity in some industries the views explicitly that for the backward cement production capacity is also relatively large number of provinces in support of restructuring of large enterprises jointly, through the replacement of backward production capacity equivalent to build a new line of to promote the work out backward. This provision for large-scale cement enterprises to open the door to industry consolidation.

   "The re-Chao" Resurfaces The national or re-layout According to China's 2007 release of national priority to support structural adjustment of cement enterprise directory, there were 60 key support for enterprises, including 12 large-scale cement enterprises nationwide, 48 regional large-scale cement enterprises. At present, the country's total number of cement companies more than 5,000. Analysts concerned that the future of the industry, the major price adjustment should be tilted to 60 companies, including key support for 12 national merger and reorganization of large enterprises.

    Than in a large-scale reorganization of the way wind and water run cement companies, a number of small and medium sized cement companies, in particular the problem of excess production capacity more prominent in the eastern region of small and medium business days of cement, becomes more difficult. Zhejiang Werder cement, Lee Chiang, general manager of marketing, said the state, zhejiang cement long-standing problem of excess production capacity in each of Zhejiang cement companies will meet to address the problem to limit production and protect the price, but limiting the production of their own businesses, Zhejiang, and the provinces of cement has entered come in, making limited production and protect the price of the results were not satisfactory, supply and demand difficult to solve. Zhejiang enterprises to invest in a cement also indicated that the cement industry is a high debt, heavy assets of the industry, once the investment is very difficult to quit, and the long-term shutdown of loss-making is also very serious, so if they do not afford to lose too much, we would choose to continue production, leading to increasingly fierce competition in the industry. Recently, China's building materials of cement to form the South, designed to be integrated cement enterprises in Zhejiang Province, in the face of the policy, eliminate backward production capacity, many techniques for small and medium enterprises are faced with backward elimination or merger's fate.

   "Cement industry to raise the degree of concentration, either on the production can have better control, but also help to improve the industry's level of development, it should be said, is the only way the development of cement industry. Disorderly developments have led to industry supply and demand, but supply and demand contradiction and product prices rise or even the bankruptcy of enterprises, and this is not just a matter occurred in the cement industry. a number of enterprises in the product prices when the blind expansion of production capacity, production lines can not meet the requirement, the lack of core competitiveness of enterprises, in the present under the conditions of the difficulties encountered by large enterprises or the merger, is not uncommon. "Zhou Xinxin said.

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